User fee: What the critics overlook Monday, May 17 2010 

The user fee, proposed on commissioning of the new International terminal at the Thriuvananthpuram airport, has come in for much criticism:
The critics do not consider the following points:

Who will be paying the user fees?

  • Foreigners leaving Kerala from Thiruvananthapuram.
  • Non-resident Keralites who do not pay any income tax
  • The rich leaving for foreign countries for tourist and business purposes.
  • Occasional travellers

First time travelers to the Gulf would be the only group that would be hardly pressed by the user fee. But they have the option to take a train to Nedumbassery and board their plane from there without paying any users’ fee.

There is no justification for spending tax payers money for the sole benefit of the first three categories. However users fees have to be reasonable. There is no justification for collecting Rs. 775 per user for ten year’s just to recover Rs. 44 crores. The amount collected should be less than that charged in airports built under the build, operate and transfer scheme.

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Vehicles galore in Kerala Thursday, Jan 14 2010 

Yet nothing compared to the developed world

Motor Vehicles in Kerala 2007

While the number of cars on the streets of United States is dropping, Kerala is recording an increase of more than ten per cent in the number of vehicles on the roads.

The number of cars in the United States dropped by four million (two per cent) in 2009. This number is almost equal to the total number of vehicles in Kerala!

Kerala had about 4.02 million vehicles at the end of March 2007 and their number would have crossed the five million mark by now. About 15 per cent of them are cars. So, Kerala or for that matter India is nowhere near the United States regarding the number of vehicles on the roads. Kerala’s car population is only a miniscule compared to those in the developed world. Yet Kerala has reasons to worry about the growing number of cars on the streets.

Road development is becoming increasingly difficult on account of problems in acquisition of land. The NH 47 and NH 17 are proposed to be development with a width of just 45-metres while the national norm is 60 metres. Accidents are increasing in the State on account of poor condition of roads and other factors. More vehicles also mean more pollution.

Before cars become a habit for Keralites like Americans, public transport ought to be developed to satisfactory levels. None would want to travel by the buses of State Road Transport Corporation, it they have afford to have other means for travel. The situation should be changed urgently. In addition, high speed rail corridors and metros ought to be developed fast.

Subsidising the neorich Tuesday, Oct 30 2007 

Handling of flights a the airportThe Government is considering reintroduction of airport fee at Cochin international airport. At the same time, moves are afoot to grant some sort of subsidy to Gulf Malayalees. The Centre is being pressed for extending benefits to Gulf Malayalees.

In other words, the politicians are trying to extend some concessions to the Gulf Malayalees, on one hand, while planning to take away the same on the other hand. The airport fee is touted to facilitate further development of the airport. Who would be the beneficiaries of such policies? None other than the shareholders of Cochin International Airport Limited (CIAL)! (The Government only holds 26 per cent of the equity).

CIAL is trumpeted as a profit-making company. Then, why is it finding difficult to raise funds for its developmental plans? Why is it paying out dividends if the company requires funds for its future plans? Why could the company make a public offer or rights issue to raise the needed funds?

Similarly, why should Gulf Malayalees require subsidies of any kind? Are they eligible for any kind of Government subsidies as they pay no income or other taxes? Is it right to use the taxes paid by low-paid Indians to subsidise any project for the overseas Indians?

Why is the Kerala Government trying to launch an airline with NRI businessmen at a time when airlines are merging to stay afloat? Won’t this airline be used to provide some sort of indirect subsidies, which may ultimately benefit only the shareholders?

The answer to these questions could be linked to political contributions. These days, much of the political contributions are coming from the Gulf countries. Naturally, policies are being framed to suit the donors.